Oil industry cranks up lobbying effort

John PorrettoAssociated Press

Published 7:00 pm, Thursday, June 18, 2009

HOUSTON - Oil and gas companies have accelerated their spending on lobbying faster than any other industry, training their gusher of profits on Washington to fight new taxes on drilling and slow efforts to move the nation off fossil fuels.

The industry spent $44.5 million lobbying Congress and federal agencies in the first three months of this year, on pace to shatter last year's record. Only the drug industry spent more.

Last year's total of $129 million was up 73 percent from two years earlier. That's a faster clip than any other major industry, according to data from the Center for Responsive Politics.

From the late 1990s through the first half of this decade, the oil industry spent roughly $50 million to $60 million a year on lobbying. It ramped up lobbying in 2006, when Democrats retook Congress, and further as President Barack Obama took office.

"They're under attack, they're ramping up their operations and they've got money to spend," said Tyson Slocum, who runs the energy program at watchdog group Public Citizen. "They're in much better position than other industries to draw upon financial resources for their lobbying effort."

Billions of dollars in oil profits in recent years have made the industry a target for new and higher taxes on exploration and drilling. Oil companies and refiners are also trying to blunt the impact of costly climate change legislation pushed by Obama.

While most oil and gas executives acknowledge the nation needs cleaner energy, they say lawmakers are misguided about how quickly it can happen. They warn that taxes and tighter rules on exploration could cripple the industry before new technology is developed.

Exxon Mobil was the biggest spender in the first quarter, pumping $9.3 million into Washington - three times what it spent a year ago, according to House disclosure reports.

In its House filing, Exxon noted it lobbied on high-profile topics like climate and tax legislation as well as provisions regarding the chemical industry, education and health care.

Combined, the three largest U.S. oil companies - Exxon, Chevron Corp. and ConocoPhillips - spent about $22 million on lobbying in the first quarter. Smaller, independent companies that produce the bulk of the nation's crude and natural gas are spending millions, too.

They're spending more even as profits have subsided. The big three U.S. oil companies spent just $12.4 million on lobbying in the fourth quarter.

First-quarter spending on lobbying by the oil industry trailed only drugmakers and health products companies, which spent $66.6 million.

"I can tell you, I've had substantially more visits than usual," said Rep. Gene Green, whose south Texas district is in the heart of oil country. Among his callers, he said, have been representatives of ConocoPhillips and Exxon Mobil to discuss climate-change legislation and other matters.

To a degree, the investment appears to be paying off. On Wednesday, a Senate committee voted to lift a ban on drilling across a vast area in the eastern Gulf of Mexico. The provision, which the industry pushed for, is included in a bill that would expand the use of renewable energy sources such as wind and solar. The bill now goes to the full Senate.

Democrats from oil states have also managed to get rid of a provision in an anti-pollution bill that would have required refiners to meet a standard on low-carbon motor fuel. Refiners say the bill would still be devastating to business.

Most major industries have increased what they spend on lobbying, but no one has done so at a faster clip over the past two years than oil and gas companies, according to data from the Center for Responsive Politics.

The enormous amount of money funneled to Washington by energy companies comes after some members of Congress suggested slapping the big oil companies with a windfall profits tax last year, when Americans were seething over $4-a-gallon gas.

Democrats - who also took the majority of state legislatures and governorships in 2006 - traditionally have not been as cozy with the oil sector as Republicans, and the energy lobby has spent the past few years trying to make inroads.

"You'll often see a correlation between spending and an industry or company that's in the hot seat," said Sheila Krumholz, the Center for Responsive Politics' executive director. "That will be enough to get them to hire additional guns and direct more money to lobbying."

Sean Brodrick, a natural resources analyst at Weiss Research Inc., cited the coal lobby as an example of one that's already had some success with the Obama administration.

He noted a futuristic coal-burning power plant in Illinois that languished under the Bush administration has now found favor with Obama Energy Secretary Steven Chu. The Energy Department will commit more than $1 billion to the project under an agreement announced last week.

"I think (the Obama administration) will make some accommodations," Brodrick said. "They may speak really tough before these laws are enacted, but you watch, I bet the energy companies will have some effect in actually shaping how these laws finally come out of the big sausage factory."

Here's the rate at which major industries increased spending on lobbying in Washington between 2006 and 2008:

- Oil & Gas: 73%

- Air Transport: 59%

- Electric Utilities: 43%

- Pharmaceuticals/Health Products: 29%

- Business Associations: 24%

- Misc. Manufacturing & Distributing: 21%

- Education: 17%

- Hospitals/Nursing Homes: 16%

- Insurance: 14%

- Computers/Internet: 4%

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Source: Center for Responsive Politics, disclosure filings with U.S. Senate.